One of the staples of classic novels is the unexpected inheritance. If Charles Dickens or Jane Austen or Louisa May Alcott needed a happy ending, they would have their protagonist come into an unanticipated fortune.1

Not surprisingly, it’s a popular idea outside of fiction. And for several decades the media has been telling us that a historically unprecedented transfer of generational wealth is going to happen very soon. For example, The New York Times ran stories on the coming inheritance wealth boom five times between 1999 and 2023.2

And based on commonly-presented statistics alone, it appears that many of us should be expecting to receive a huge lump sum any day now. The 55.8 million Americans over 65 (about 17 percent of the population) hold $96.4 trillion (about half the nation’s wealth). As they pass away, it would seem they should be leaving substantial fortunes to their children and grandchildren.

Unfortunately, it doesn’t often happen that way. The U.S. Bureau of Labor Statistics looked at data from 1989 to 2007 to see if they could find evidence of a Great Wealth Transfer. They discovered that over that period, instead of ramping up as expected, the number of families reporting an inheritance actually fell by 2.5 percent.

There are several factors that are making substantial inheritances relatively uncommon.

First of all, wealth is not spread evenly among older people. A large percentage is held by a relatively few ultra-wealthy. Their heirs will probably receive a lot of money.

Secondly, a person’s final years can be quite expensive. Finance writer Ann Logue tells the story of her husband’s aunt, who at age 87 told him that he would inherit her estate when she died. At the time she declared this she had a $250,000 nest egg. But she soon required increasing medical care. And by the time his aunt died, Logue’s husband received around $2000.

“Instead of paying off our mortgage,” writes Logue, “we used the money to replace our dining room windows.”

While receiving a substantial windfall through an inheritance can be a financial positive (who couldn’t use more money?), counting on it to secure your economic future can have a number of negative effects. You can begin to see your older relative only in terms of what they can provide to you when they die. You can experience relationship-damaging conflict with your siblings or other heirs over who gets how much. And there’s a good chance that a sizeable windfall will never materialize.

Instead, it’s best to work with your trusted advisor to plan for your retirement based on the income you have control of. And if you do happen to make out like Pip from Great Expectations, they can help you invest that money in a way that’s designed to help prepare you for the future.